Karches v Sterling
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Karches v Sterling 2005 NY Slip Op 30276(U) April 12, 2005 Supreme Court, New York County Docket Number: 0604995/2001 Judge: Karen Smith Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. [* 1 ] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY PART 060499512001 KARCHES, PETER NDEX NO. STERLING, OLIVER JAMES VlOTlON DATE vs JlOTlON SEQ. NO. SEQ 1 JUDGMENT SUMMARY AOTlON CAL. NO. PAPERS NUMBERED Notice of Motion/ Order to Show Cause - Affidavits - Exhibits Answering Affidavits - Exhibits - Cross -L 0 0 I ... 2 1 3 Replying Affidavits Dated: q,/ 1 y / h 5 Check one: d A Check if appropriate: KAREN 8 L DISPOSITION ]:.I DO NOT POST J. s. c. NON-FINAL D I S ~ ~ ~ T l O N [* 2 ] Index no.: 604995/2001 Motion seq.: 001 Motion date: February 14,2005 Plaintiff, -against- DECISION AND ORDER OLlVER JAMES STEWiNG , I ,1 < < J L PlaintiffPeter Karches s motion, pursuant to CPLR 5 3212, for an order granting summaryjudgment is granted in part and denied in part, and defendant Oliver James Sterling s cross motion for an order granting summary judgment dismissing the complaint is granted in part and denied in part. This action arises out of an Agreement for Sale and Purchase of Stock ( Contract ) and a promissory note ( Note ) issued pursuant thereto. Plaintiff moves for summary judgment on the ground that defendant has breached his obligations under the Contract and Note and can offer no defense for his breach. Defendant moves for summary judgment on the grounds that plaintiff s claims are time barred and that plaintiff has failed to properly serve defendant and thus the court has not acquired personal jurisdiction over defendant. The relevant facts are contained in the parties moving papers and are not in dispute. Plaintiff and defendant entered into the Contract on February 7, 1994. Under the terms of the Contract, plaintiff agreed to convey to defendant all of plaintiffs shares of common stock in Excelco Energy, Inc., ( Excelco ), a Deleware Corporation. In turn, defendant agreed to pay plaintiff a total of $120,000, paid in three installments. Under the terms of the contract, defendant was to pay $30,000 upon receipt of the shares and to execute the Note, providing for payments to plaintiff in the amount of $30,000 on or before February 1,1995 and $60,000 on or before February 1,1996. On February 7,1994, plaintiffconveyed all ofhis Excelco stock to defendant and defendant tendered $30,000 and executed the Note. Defendant has failed to tender the payments due under the note and is now in 1 [* 3 ] default thereundcr. Plaintiff initiated this action by purchasing an index number and filing his Summons and Complaint with the County Clerk s office on October 18,2001. By way of an affidavit, plaintiffs process server Brad Weeks alleged that, starting on December 19, 2001, he attempted to serve defendant in person approximately 18 times at what he understood to be defendant s home and business addresses. Finally, on January 28,2002, Mr. Weeks affixed a copy of the summons and complaint to defendant s business address and sent a copy to the same address. Defendant served an answer on February 26,2002. In his complaint, plaintiff claims that defendant breached the Contract by failing to tender payment pursuant to the Note. Defendant s answer acknowledges execution of the Contract and the Notc and enters a general denial of the remainder of plaintiffs allegations. Defendant also raises two defenses. First defendant argues that the court lacks jurisdiction over defendant as plaintiff has I failed to properly serve dcfendant. Second, defendant argues that plaintiffs claims are time barred. The proponent of a motion for summary judgment must make a prima*facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence in an admissible form to demonstrate the absence of any material issues of fact (Gurfiidu v. Citibunk 100 NY2d 72, 81 [2003]). Once the movant has made such a showing the burden shifts to the party opposing the motion to produce evidence in an admissible form sufficient to establish the existence of any material issues of fact rcquiring a trial of the action (14. The portion of defendant s motion that seeks summaryjudgrnent on the grounds that plaintiff has failed to properly serve him is denied. CPLR 5 321 1 (e) clearly states that a party who objects to jurisdiction on the basis of improper service in his pleading must move for judgment on that basis within sixty days of the pleading, or that objection will be waived. Here, defendant served his answer on February 36,3002, but seeks summary judgment on this ground alnost three years later. Regardless of the propriety of service, defendant has waived any defense on that ground. As such, this portion of defendant s motion is denied. The portion of defendant s motion raising the defense of statute of limitations is granted as to the first installment payineiit due under the contract. Actions based upon contractual obligations must be brought within six years of the accrual of the cause of action. (CPLR 2 tj 213) When a [* 4 ] contract calls for payments in installments, the statute of limitations begins lo nin on each installment from the time it becomes due. (Vigilant Insurunce Company qf America v. Housing Authority qf El Paso, Texas, 87 NY2d 36,45 [ 19951). Here, plaintiffs claim is clearly based upon a contractual obligation. The first payment was due on February 1, 1995. Plaintiff did not commencc this action until October 18, 2001, more than six years after the first payment became due. As such, that portion of plaintiff s claim is time barred and defendant has demonstrated that he is entitled to judgment as a matter of law. Plaintiff s argument that defendant waived his statue of limitations defense is without merit. Agreements to waivc statute of limitations defenses that are entered into at the inception of a contract are void as against public policy. (John J: Kussner & Co. v. Cily o New York, 46 NY2d 544,55 1 f [1979]). Here, the language plaintiff purports to be defendant s waiver is contained in the note defendant signed on the same day on which the contract was formed. As such, any waiver of a statute of limitations defense contained therein is invalid. Plaintiffs claim for summary judgment on the second installment, in the amount of $60,000 due on February 1,1996 is granted, and defendant s motion to dismiss this claim is denied. Plaintiff has put forth proof sufficient to establish plaintiff and defendant entered into a contract, that plaintiff performed his duties under that contract and that defendant breached his duties under that contract. As such, plaintiff has made his prima,facie showing that he is entitled to judgment as a matter of law. Defendant has failed to put forth proof sufficient to raise a material question of fact as to this claim. De ¬endant s contention that this portion of plaintiffs claim is time barred is without merit. Defendant argues that, upon his failure to pay the first installment on February 1, 1995, he was in default on the note and the payment originally due February 1 , 1996 became due on that date as well. As such, de ¬endant argues, both installments are time bxred. This zgfiment ignores the specific language of the Note, which states that, if Maker fails to pcrform or observe fully any obligation or condition to be performed or observed by Maker under this note . . . then a default shall exist under this note and thc entire unpaid principal balance on this note shall become immediately due and payable, at the option of lhe holder o f h i s nole[.] (Emphasis added). Hence, the remainder became payablc on February 1 , 1995 only at plaintiffs option. Defendant has not alleged or put 3 [* 5 ] forth any proof that plaintiff exercised his option to accelerate the remaining balance at any time before February 1, 1996. As plaintiff brought this action within six years of that date, plaintiffs claim is timely. Accordingly, it is hereby ORDERED that plaintiff s motion is granted as to the installment due February 1, 1996, and the Clcrk of the Court is directed to enter judgment in favor of the plaintiff and against the defendant in the amount $60,000, together with interest at the rate of 9% per annum from February 1, 1996 until thc datc of entry of judgment, as calculated by the Clerk, and thereafter at the statutory xatc, together with costs and disbursements to be taxed b the Clerk upon submission of an appropriate bill of costs, and it is further ORDERED that the remainder of plaintiffs motion is dcnied, and it is further ORDERED that defendant s rnoti n for summary judgment is grantcd as to the installment P due February 1, 1995 and is denied as to the remainder of the claims therein. This constitutes the decision and order of the court. Dated: April 12, 2005 ENTER: New York, New York J.S.C. 4
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